JANUARY 23, 2018

Episode 7 – How Crypto for Social Good Will Change the Way We Give Back

Drew Galloway, Willy Ogorzaly, and Ryan Lugalia-Hollon

In this episode, we’ll speak with three special guests – Drew Galloway, Willy Ogorzaly, and Ryan Lugalia-Hollon – about the basic questions surrounding cryptocurrency and the blockchain and how these technologies are being used for social good.

What is cryptocurrency? What is a blockchain? Learn how this decentralized ledger, the blockchain, creates the potential to send anything to anyone including rewards for socially good actions and behaviors. Our guests discuss the future of crypto for the philanthropic-minded, and why it all starts with trust, transparency and peer-to-peer transactions. 

Matt McDonnell (00:00):
Welcome to this week’s episode of Change the Rules podcast. I’m Matt McDonnell, Managing Partner at Notley and today we’re going to be talking about cryptocurrency, the blockchain, and how some innovators, including our guests here today, are using it for social good. So I’ll introduce our guests now. We’ve got Ryan Lugalia-Hollon. Ryan’s the Executive Director of P16PLUS in San Antonio and the author of the War on Neighborhoods, a book coming out this April. Hey Ryan, how are you?

Ryan Lugalia-Hollon (00:27):
Good, sir. How are you?

Matt McDonnell (00:28):
Good, thanks for joining us. We’ve got Drew Galloway here, Executive Director of Move San Antonio, an innovative democracy nonprofit. Thanks for joining us.

Drew Galloway (00:36):
Thanks, Matt.

Matt McDonnell (00:37):
Yeah. And we’ve got Willy Ogorzaly here. He’s the CEO of Cause. Cause is a blockchain based social network designed to facilitate and incentivize problem-solving. Thanks for joining us, Willie.

Willy Ogorzaly (00:49):
Thanks Matt.

Matt McDonnell (00:50):
So I, I just sort of mentioned what everybody here is working on. We’ve also got Lisa Graham here, co-founder of Notley. And so-

Lisa Graham (00:58):
Thanks. Thanks, Matt.

Matt McDonnell (00:59):
Yeah. Sorry, Lisa. [Laughter] And so you know, I was hoping that we can just start, right, and just tell us a little bit, I will start with you Willy, but you know, what are you working on with Cause, right? What’s the central problem you’re trying to solve. And how, how does blockchain really fit into that?

Willy Ogorzaly (01:16):
So to put it in, you know, one problem, I guess the problem that we’re trying to solve with Cause is really to save the world. And I know that sounds bold, but you know, hopefully today we can explain a little bit about how we’re trying to do that. So I guess another way to look at the problem we’re trying to solve is the fact that every year, about $390 billion gets donated to nonprofits, but how many problems actually get solved? Well, no one really knows. And one thing’s for sure is that it’s not enough. So, you know, as an entrepreneur, looking at the world and seeing that right now, we’re kind of counting on these nonprofits to solve these problems. And so far they don’t necessarily have the best track record inspired me to start thinking about how could we solve these problems? How could we actually, you know, solve problems like global warming, because if we don’t solve it, then there’s no guarantee that we as humanity are going to survive for forever. So as an entrepreneur, there’s really no bigger problem that I’d like to focus on solving. And I think that blockchain and cryptocurrencies are kind of the missing key that make a platform like this possible. So once I realized that, I pretty much committed everything to building this and I haven’t looked back since.

Matt McDonnell (02:14):
Okay, thanks. And, and we’ll, we’ll get back into exactly how you’re doing that here in just a minute. Drew, how about yourself?

Drew Galloway (02:21):
Sure. So I’m the Executive Director of Move San Antonio, which is a grassroots non-partisan, nonprofit, and we build power and underrepresented youth communities in San Antonio through civic education, leadership development, and issue advocacy. So we understand that the millennial generation has the strongest voice in America. We just don’t exercise it like we should. And so we take really innovative steps, things like doing massive voter registration drives all across San Antonio, doing parties at the polls and parades to the polls and, and ways to amplify young voices all across our city. And it’s working. We, we know that, you know, through the data that young people are paying attention and the more that we register, the more we’ll actually make it to the ballot box. And we’re seeing those percentages go up and up and up. And so one of the things we’re working on is that young people say, why can’t I vote off my cell phone? And that’s where the blockchain comes in.
Ryan Lugalia-Hollon (03:27):
So I’m Ryan and I’m Executive Director of P16 Plus Council in Bexar County and P16 stands for preschool through the end of college and plus is for workforce. So we’re, what’s considered a cradle to career network. So I’m really interested in the same question Willy’s interested in, which is why, why are we not seeing more progress on major social change problems and what’s slowing us down. And so part of our theory is that institutions are working in isolation. I may have a mission that says let’s end poverty, or let’s educate every child. And there may be a a hundred other organizations in San Antonio with that same mission. But if we’re not aligned, if our arrows are pointing in different directions, then we’re not leveraging our collective weight and our collective power to that. So as a cradle to career network, we’re supposed to be getting, and we work hard to get early childhood providers and leaders, K-12 leaders and youth development agencies and higher ed leaders all pulling in the same direction.

Matt McDonnell (04:24):
Got it. So, yeah, so we, you know, we started thinking at Notley a lot more carefully about blockchain. You know, we, we see a lot of investment pitches and I’d say probably about a year and a half ago, the pace just dramatically accelerated in terms of, of blockchain opportunities. And then about six months ago the deal flow changed from being this sort of purely for-profit investment opportunity. And we started to see a lot of social impact applications, or at least starting to hear about them or people sort of chewing ideas over about how you can use the blockchain and cryptocurrency for social good, right. Or, or for some sort of public benefit. And so, you know, we we’ve been looking around and, and so just want to sort of have the disclaimer that the, the purpose of this conversation today is really just to kind of learn a little bit. We hope that the folks that are listening are, will be inspired to learn a little bit more and we’ll be offering a number of resources in the description to the podcast so that you, you can learn a little bit more but as we get started, I think that the, the big question here is what the heck is the blockchain and what is cryptocurrency, and then we’ll start to move towards how exactly each of you are using it for social good. So we’ll start again with, with Willie here and I’ll switch it up next time, but if you can just sort of give us you know, in our prep for this conversation, you all had three very different answers for what is the blockchain and what is cryptocurrency and, you know, all, all equally valid. So we’ll, we’ll just go around quickly.

Willy Ogorzaly (05:48):
Sounds good. It’s tough to explain simply so we’ll do our best. I think of a blockchain is literally a chain of blocks. Those blocks are, can be any type of data. In the case of Bitcoin, those blocks are a, it’s a ledger of transactions and these blocks are chained together. And that chain of blocks is not running on a server in the cloud. One server, it’s running on a bunch of- a distributed network of computers. So any computer can run this chain of blocks. And so what that means is that once a new block is added to the chain and verified by this network of computers, no one can go back and alter that blockchain. So it answers kind of the age old question of how do we create this decentralized network and ensure that all of the transactions that are recorded are accurate and true and not false. And how do we prevent somebody from being able to gain the system and double spend a currency or alter a block that has already been stored? So it’s pretty simple. I think very few people are going to actually end up understanding the mechanics behind how it works. But what individuals need to understand is that now we have the potential of creating these distributed networks, where anyone can send anything to anybody without anyone’s permission and without having to trust anybody. And I think that those are really the fundamentals that everyone should understand is really the potential of it.

Lisa Graham (07:04):
So when you say users on their personal computers, how do you create that network?

Willy Ogorzaly (07:09):
So anyone right now, you have to take some tech, technical savviness, but you could set up a node is what they call it. And you can basically run this whole chain of blocks on your own computer. That’s kind of the traditional way. That’s how it started. And, but now what’s happening is that in order to run the full Bitcoin node or a full Ethereum node, it takes a lot of space on your computer. So now that blockchain and cryptocurrencies are becoming more popular and more widespread the original kind of protocols that they were designed with are making it not very scalable. And the whole idea of it being totally decentralized and enabling any individual to run a full node on their computer, which would make it the hardest for anybody to alter these blocks, isn’t really coming to fruition. So that was the first wave. Now we’re seeing, you know, these later waves of blockchain protocols that are more scalable, and maybe there is some loss of trust, but you don’t really need every single computer to be running this node in order to make it trustless. You can do that. You know, every 12th computer running, one 12th of the node randomly is a way to do that more efficiently. And those are, that’s just one example. So end users won’t necessarily need to run nodes on their computer and there’s there’s some blockchain startups are coming up so that you don’t need to have any technical savviness just by visiting a website, they’ll start mining for you on your computer. So there’s interesting use cases popping up that are going to solve that problem.

Lisa Graham (08:26):
And what’s the benefit to running this on your computer. So why would I ever choose to take up space on my computer to be a node in a blockchain?

Willy Ogorzaly (08:35):
So that’s where the cryptocurrencies come in. So the incentive for running this node and using your processing power is mining these cryptocurrencies. So when everyone talks about mining, that’s really how you mine a cryptocurrency and how you get rewarded for running this whole node on your computer. You basically earn money. Yeah. You basically earn money. That’s right. Yeah. But the thing is too, is that in order to actually mine a bitcoin block it takes a lot of processing power.

Lisa Graham (08:57):
What’s a lot?

Willy Ogorzaly (08:57):
Like a whole data center’s worth.

Lisa Graham (09:01):
I mean, how much is that? I mean, I have a-

Willy Ogorzaly (09:03):
More than you have in, in all the computers in your home.

Lisa Graham (09:05):
Got it. Ok.

Willy Ogorzaly (09:06):
But what you could do is you could take the computers in your home and you could lend your, you can share your mining power in the pool. And then when the pool, when the other million computers that you’re working with, actually do mine a new block, you guys would share the reward.

Lisa Graham (09:20):
Got it. Okay. How about you Drew, you had you had some pretty good analogies, I recall.

Drew Galloway (09:28):
Yeah. You know, we talk a lot with young people about what blockchain voting is and why like the blockchain is so important to democracy and this sort of futuristic idea of being able to vote on, you know, from your cell phone or your computer. And so the analogy that we use is that if you think about like a volcano and there’s like these bits of information, which we’ll call like gyms or diamonds, and they’re all laid out as like a flow of lava comes up over the, and like encapsulates the, the, the diamond. We look at that as like the block building mechanism that Willie referred to. So then if you try to like break up the lava to get to the diamond, you would be able to see that. And so in a lot of ways, that’s the way we try to conceptualize, or at least visualize the way blockchain works in a very simplified way for folks who might not have had any experience with Bitcoin or Ethereum or the blockchain itself. And so, you know, and when it comes to democracy applications that trust and the actual blockchain and the algorithm itself is what really, really matters.

Lisa Graham (10:39):
And can I, so to build on that, the blockchain it’s beneficial because there’s a trust there, and there is information or data. How… Can you guys explain why it’s better protected in a blockchain than sitting on a server somewhere, which is how a lot of data is currently stored. We hear about hacks all the time. People hack personal computers, explain why this is actually safer for information and more accurate and reliable.

Drew Galloway (11:09):
I would say that because it is a distributed system. So like, there’s a- it’s decentralized, it’s not on one server, it’s spread across everywhere. And then it’s also encrypted. Like you’ve got, you know, you have to have the, the code, the hash code to be able to access that information. And then if you try to break in and, you know, change this vote or change this, this transaction currency and it doesn’t match all of the other data that’s being mined, then the system’s going to quarantine that as like an error.

Lisa Graham (11:45):
You would have to theoretically have a block- block chain. So a chain of computers large enough that someone couldn’t break into all of them, or like a certain percentage of them.

Willy Ogorzaly (11:58):
That’s right. So if you had it on a server, you’d have to break into one server and then you could hack it with the distributor network, now you’d have to hack into at least 51% basically of the mining pool.

Lisa Graham (12:08):
So that’s when the trigger comes out that says, this data is no longer accurate, or-

Willy Ogorzaly (12:15):
So if you were to try to make a change to the blockchain- your computer were to broadcast a blockchain that was different than the blockchain that the other million computers in the network were broadcasting, none of the other computers would even accept that change. They would say, nope, this is false. They wouldn’t even accept it, so you wouldn’t even be able to modify it. But the one possibility is that a 51% of the miners were to come together and basically scheme on changing it, they could create their own chain. And really the longest running blockchain is the blockchain that has the authority. So there is some risk, but it’d be very difficult to get 51% of the pool to go act maliciously. And right now the incentives aren’t really set up for them to do that. So the cool thing about the blockchain cryptocurrencies is that as long as everyone acts out of their incentives, then we should be good.

Matt McDonnell (12:59):
So, yeah. So Ryan, how do, I mean, how, how do you describe the, the blockchain in a very different application here of, you know, pre-K through college and workforce readyness?

Ryan Lugalia-Hollon (13:09):
So, so my background is in urban planning and the most famous American urban planner of the 20th century was Jane Jacobs who wrote a book called the Death and Life of American cities- and of the Great American City [Book title: The Death and Life of Great American Cities]. And so she uses a phrase in that book called “eyes on the street”, and she’s asking what makes a community safe? What, what creates safety on a block? And she says that what creates safety is eyes on the street. So a healthy community, you have people looking out the window, people looking out- like standing in the doorway, people sitting on their stoop, people walking down the sidewalk and all those people together who make up the community create safety. So if a purse is stolen or someone is hit everybody that, you know, the person looking out the window, the person got on the stoop and the person on the doorstep, they all see what happens and they become, they can verify what happens. So blockchain is kind of a technological equivalent of that, where eyes on the street are the nodes in the network, and all these people can verify what happens. And that fundamentally changes how trust is built, because we live in a world where we say, you know, I don’t, I can’t necessarily trust Matt. I can’t necessarily trust Lisa. I can’t necessarily trust Drew. So I’m going to trust this institution. You know, I’m going to trust this bank, or I’m going to trust, you know, this other verifying party. And the, the revolution in blockchain is saying, you know what, I’m not just going to trust an institution. I can now trust a network. And so it’s taking that to the next level.

Willy Ogorzaly (14:35):
I think it’s also interesting to point out that, you know, in America it might be more difficult for us to see the benefit of this, because we do have banks that we feel like we can trust. And even in America, we see these big banks and stuff. Maybe you can’t trust them. Maybe we shouldn’t be placing all of our trust in them, but when you go out to some of these third world countries and stuff, they don’t near the infrastructure that we already have, and there’s, it’s much more important for them to have this trustless system.

Matt McDonnell (14:57):
So, so what are some of the trends that you guys are seeing before without talking about cryptocurrency? We’ll, we’ll get there in a second, but what are the, the social good applications that you guys see for the blockchain or what are some of the things that are really exciting?

Willy Ogorzaly (15:09):
So I think there’s kind of two camps. There’s, there’s, you know, one camp of companies that have already been out there for awhile and nonprofits that have already been out for there for awhile thinking, you know, how can we now utilize blockchain to do what we were already doing more efficiently and in a more effective way. And then there’s some new companies like Cause that are thinking, okay, now that the blockchain technology is here, how can we create something that’s never before been possible, but now is finally possible. So so one example that I think is really cool is AID: Tech. They just partnered with the Red Cross to go create identities for the 3 billion people in the world who don’t have an identity right now. And it’s, and the fact that they partner with the Red Cross is going to give them the infrastructure and the human capital to actually go out there and create all these identities. But now the use case for an individual now in a third world country who before had no identity and, you know, all their money was in cash that they carried with them basically. And it was hard for them to get a job because there was no verifiable work history and their criminal history was a question. I heard a good example of the day that says, you know, what, if the Taliban says you’re a criminal, what does that mean? So now with this, with AID: Tech, these people are actually going to have identities and that opens the door to banking, voting, all sorts of new things that right now wasn’t really possible before. And it’s going to unlock what I’ve heard is estimated to be $10 trillion worth of wealth that is currently out there, but isn’t documented. It’s just, you know, in people’s pockets, in their- in their home, that’s on land that they don’t have a deed to. They’ve just been living there for three generations. So unlocking the $10 trillion of wealth and giving these people the possibility to enjoy a lot of the, you know, first world benefits that we’ve come so accustomed to. I think it’s incredibly profound.

Matt McDonnell (16:44):
How about you Ryan?

Ryan Lugalia-Hollon (16:45):
So Drew and I drove up here from San Antonio together, drove up to Austin and got to do a lot of visiting in the car. And a point that he made that I really appreciated is the energy behind blockchain is really coming from cryptocurrency. It’s saying, “Oh my gosh, this is the wild wild west. This, we let’s go be gold miners in the 21st century and we can make some loot.” But that’s not necessarily what the lasting impact is going to be, and it could be that cryptocurrency, you know, it’s, it rises and falls and it lives for a period of time or it lives forever. But the blockchain technology, the new way of creating trust that we’ve been talking about is the bigger revolution. And so we’re just scratching the surface of, of what that could mean. So I’ll share one really concrete user case that’s not necessarily a social good application, but I think does have social benefits, but I think it will help the listener just understand the viability of this. And that’s the there’s a new browser called brave that’s being built by one of the founders of Mozilla who helped to launch JavaScript and Brave is all about creating a higher privacy, higher security online experience. And alongside this browser, they’ve launched a token called the “basic attention token”: BAT. And the purpose of Brave and BAT together is to change the relationship between advertisers and the person surfing the web and that you have, right now, whenever I get online, I get bombarded with advertisements and browsers have a limited ability to cut that down. So just as a browser, Brave is, is limiting the ability of ads to come shape my experience. But then the blockchain application is is using BAT to say, you know what, not only are we going to limit that, but we’re going to, we’re going to allow your relationship to ads to be totally curated. So we’re going to create a better economy for the producer of those ads. We’re going to create more reliable data for the person driving the advertising. And we’re going to give you more autonomy and choice as a consumer of those ads. And it’s using this browser-based application of, of, of a blockchain currency called Ethereum to, to change that relationship between producer, advertiser, and consumer. And it’s, it’s establishing basically a new economy among the players that are already involved in digital advertising, but one that’s more beneficial for all three. And are you saying that the relationship changes that the individual who’s paying attention to the content on the screen is now getting paid for their time? Yeah, they’re getting paid for their time. Their producer is getting a much greater percentage of the money that is being paid for the advertising. And and then the whole thing has a lot more transparency now. So dollars are invested more efficiently.

Lisa Graham (19:38):
So what I’m hearing is it sounds like it’s more secure, which is great, but then maybe the applications come to more voting. Like this is how we can maybe have a secure online voting system. Or-

Drew Galloway (19:51):
And I think that the, if you drill down to like what it’s all about, and I think Willie and Ryan touched on it is it all comes back to trust, you know? And so like, it’s like, I, in, in any type of like transaction, whether that’s a financial transaction or that’s a contractual agreement, or that is like a government to citizen, you know, interaction, as in voting, I have to trust that whatever on some end of that, that, you know, what you say you’re going to do and what I say I’m going to do is actually going to happen. Blockchain revolutionizes that.

Lisa Graham (20:27):
Okay. So like right now I do a lot of online purchases. I assume I’m going to get what I get. And if I don’t, Amazon gives me my money back, right? Like, how is this better than just buying something from Amazon?

Willy Ogorzaly (20:38):
[Inaudible] So it’s all about trust, but where does, how does trust actually come into play these days? Right now you are trusting people and you are trusting your bank basically. And they have right now all of your money that you have, you’re trusting the bank to to ensure that money. And again, in America, you know, we feel pretty comfortable being able to trust these intermediaries, but it always, anytime that there’s trust right now, like Matt said, it’s not enough for us to just trust an individual. You have to trust this intermediary. And that’s what we see happening is that there’s an, there’s a government basically that verifies this. There’s a you know, identifications are stored somewhere; bank account information is stored somewhere. We’re trusting all these intermediaries. Whereas if I want to give you money and you’re across the world, why should, why does there need to be an intermediary? Because what happens with these intermediaries is they produce inefficiencies. And when they’re not really incentivized to change, because that’s kind of the status quo, they become very inefficient. And that’s what we see happening. So the coolest thing about the blockchain is that when you don’t need trust anymore, you also don’t need these intermediaries. And other benefits of blockchain are like micro-transactions. So something that wasn’t possible before is sending money across the world. Now you can send a penny across the world and not only do you, can you send it? Your fridge could send, you know, 3 cents across the world.

Lisa Graham (21:47):
My fridge can’t do that.

Willy Ogorzaly (21:49):
Not yet- [laughter] but because of the blockchain I thinks it’s going to be able to-
Lisa Graham (21:53):
I mean, it also is enlightening- it sounds too, like, my question is coming from a place of immense privilege where I trust that those companies that I’m buying, like I have the ability to do that. Kind of going back to what you said before, there are a lot of people who just aren’t living in a situation where that trust is even built into most of their-

Willy Ogorzaly (22:10):
Right. It’s much easier to see the benefits and stuff. Yeah.

Lisa Graham (22:12):
-institutions that they’re interacting with in these third world countries.

Ryan Lugalia-Hollon (22:15):
So there are- I totally agree with the trust emphasis and with the point that there are majors- there are some sectors where like, let’s say there’s 95% trust in that sector. And there are other sectors where, especially now with American democracy to Drew’s point where maybe there’s 50% trust and so blockchain by creating these eyes on the street, by creating this like distributed ledger is able to to attack those inefficiencies and create greater trust where it doesn’t currently exist. But I think because we’re just at the beginning of this trust is only one application- like the direct value add and direct product of the blockchain is greater visibility; is distributed visibility of anything. And trust is an obvious by-product of that. But I, the projects I’m interested in are actually applying the benefits of that, that broad visibility in a different way. And I think appreciation- just the ability to say, wow, Lisa, I saw what you did. You know, Matt, I saw what you did. When you were just walking down the street and helped that person. And because of that, I’m going to take a blockchain based action that speaks for that. Or I saw what you did when you were helping that old lady across the street, whatever it is. So their visibility has all sorts of applications. And I, and I agree that trust is the kind of foundational one, but I think there are other, I think we’ll explore a lot more potential applications of what happens when we now can record and follow up on transactions in a totally new way.

Willy Ogorzaly (23:46):
So I guess it’s- somehow we broke it down into three benefits. We have trust, the transparency, and then kind of the peer-to-peer aspect too.

Lisa Graham (23:54):
And so when you say transparency, if I- if I’m a node and-

Willy Ogorzaly (23:59):
You don’t even have to be a node.

Lisa Graham (24:00):
Right- so then who could, so if-

Willy Ogorzaly (24:02):
Anyone with- whether you’re running a node or not, you can go up and you could look at every single transaction that’s ever happened with Bitcoin-

Lisa Graham (24:09):
On every single blockchain?

Willy Ogorzaly (24:09):
On every single blockchain. Every blockchain has their own block explorer where you can go back block by block and see every transaction ever- if it’s, you know, not a transaction, but it’s data stored there. So sometimes you can store it, even on the Bitcoin blockchain, you can store a document. And then now, you know, that document is set in stone and everyone can go back in time and look at that document at that point in time and you can’t change.

Lisa Graham (24:30):
And so I, and I, you know, I think transparency is really beneficial, but what about people who are like, I really don’t want you to see where I’m donating my money or where I’m spending my money. And it’s all stored on this blockchain. Is that going to differ to serve people from wanting to use those organizations- who are using a blockchain or on a blockchain? I don’t know the right terminology.

Willy Ogorzaly (24:47):
Some people will want their interactions to be anonymized. And we’ll talk about that in a sec, but wouldn’t, you still want to see how much money that non-profit got and what they did with it, but I can see that right now. So yeah, well, we can see it, but is it a 100% accurate, I guarantee, a hundred percent of time. It’s not. So there are a lot of, there are a lot of progress-

Matt McDonnell (25:04):
Cryptocurrencies that you can’t see. So Minero is a really popular one right now. So that that’s a whole part of this field is privacy. So, so let’s, let’s talk about cryptocurrencies and, you know, drew, I think we left off with you here. So what I mean, what is a cryptocurrency? Right. So we have the basic idea of blockchain here, right? It’s a distributed ledger. That’s totally transparent. That’s available for anybody to, to see and audit. Right. I think that’s one of the interesting applications that we haven’t touched on is things like supply chain monitoring or provisioning aid supplies to, you know you know, maybe a country that is a beneficiary of those sorts of, of services. And, and really making sure that the supplies get to the intended recipients, but what the heck, what does money have to do with this? Right. What does money have to do with this transparent ledger and, and, you know, how do you think about cryptocurrency, Drew?

Drew Galloway (25:55):
Sure. So I think, you know, if you look at cryptocurrencies that it basically runs on the blockchain. And so I think Willie accentuated this earlier of like, there has to be an incentive to be able to run the blockchain, like it has to keep moving and the incentive for not only more transactions to come in, but for those blocks to be formed and and nodes to be run is this financial incentive on top of that, of like mining. And so for me, when we talk about cryptocurrency, I’m much more interested in the contractual version of that because of my work. So Ethereum is much more interesting to me than say Bitcoin, but it all runs on that same process of like, we have to have miners that are getting some sort of like reward, whether that’s tokens, you know, bitcoin-

Lisa Graham (26:44):
Can, y’all explain, y’all use token, what’s the deal between a token and a cryptocurrency, or is that the same thing?

Willy Ogorzaly (26:49):
They’re the same thing. Yeah. So a token is a cryptocurrency; cryptocurrency is a token. Yeah.

Lisa Graham (26:54):

Willy Ogorzaly (26:54):

Drew Galloway (26:55):
And so, yeah, I think that that’s, you know, that that’s my version or my, my viewpoint of cryptocurrencies, there is the financial incentive to keep the system as a whole like trustworthy, reconciled, and, you know, and true to the blockchain.

Ryan Lugalia-Hollon (27:13):
The point earlier that blockchain itself as a platform may have a much bigger impact than cryptocurrencies. Another way of saying that is that shifting how contracts happen, shifting how agreements happen within society has much, has many more applications and use cases than just introducing new currencies. And so if, if we’re fundamentally changing the way that my performance as a leader in a space is recorded and understood and communicated, and we’re doing that with everybody in my field, then we’re changing micro-credentials, we’re changing the field of education, we’re changing how hiring happens, we’re eliminating the resume. Like there’s all sorts of ways that performance can be understood and recorded that shifts how agreements can and should be formed.

Matt McDonnell (28:04):
Can you give us a specific example?

Willy Ogorzaly (28:05):
I’ve got one- [inaudible], yeah, so you reminded me of Open Currents. So Open Currents is an example of a- another blockchain social good company here in town and what they’re doing is they’re incentivizing volunteer work. So and the way that they’re doing that is with a cryptocurrency. And so what they’ve essentially done is they’ve changed it from incentivizing miners to throw a bunch of computing power. They’ve changed it to incentivizing volunteers to go out there and do social good at work. So there’s still, it’s not like a perfect example because the charity is still, there’s still some level of trust there. And you’re trusting a nonprofit to say, yes, this person completed these hours. But what they’ve been able to do is they’ve now created an incentive for people to actually go out there and do this volunteer work. And so that’s going to have, you know a huge impact because now you can go get paid 20 bucks an hour to go volunteer.

Lisa Graham (28:53):
But my, my question there though is are these institutions creating their own cryptocurrencies? Are they using existing ones? And whatever the answer is there, I’m curious. But then also, I mean, everyone’s heard of Bitcoin, right? It’s been talked about. So if someone’s going to give me bitcoin to do something as a layman, I’d say maybe, okay. Right. But if it’s something I’ve never heard of, why would I ever go volunteer to get something I’ve never heard of and I don’t even know where to spend it or nobody even takes it. How do you guarantee that?

Ryan Lugalia-Hollon (29:24):
Well, I mean, it’s, so it’s about how you set up the contract again. So you could set up a deal where every two weeks or every month there’s transfer to U.S. dollar or there’s transfer to bitcoin. So these, these can be exchanged in relationship to one another. But the power of that is really big. Let’s, let’s get back to social change for a second, right? So we are many decades, if not, centuries, into trying to solve problems that are not changing, right? Wealth inequality is growing. You know, American schools are struggling. Violence in some cities has been increasing the last couple of years. So how do we stop these problems? Right. That’s a fundamental question. And so my position is that we don’t have enough people taking action. We don’t have enough leaders that are actively leaning in, in smart, intelligent, proven ways to help move the needle. And so my vision is that trusted institutions like schools, like nonprofits with proven outcomes, which there are many, can then become, can then deploy the blockchain. They don’t need to create their own cryptocurrency. They can deploy a project like, like Open Current and do it in ways that transform their staff of 10 or their staff of a hundred to a volunteer virtuous altruistic army of a thousand, right? And now they’re able to throw block parties every week instead of once a year. Now they’re able to recruit 10,000 mentors instead of a hundred. Now they’re able to, you know, make sure that every young person within a designated neighborhood has a literacy tutor. And so it can potentially give us access to human capital, into human energy, into human drive in totally new ways by allowing institutions that sometimes are not agile enough to work with and activate networks.

Willy Ogorzaly (31:11):
And that’s what we’re trying to do at Cause. And is that what you guys are trying to get and P16 Plus, as well?

Ryan Lugalia-Hollon (31:16):
That that’s where we want to get. Right now, what P16 Plus does is a lot of actually- we do, we’re deep in a field called Results Council leadership or results-based accountability, which is part of we’re part of a national network called Strive Together. And we- we’re a data shop that looks at outcomes. So we have 28 nonprofit agencies and we measure their student outcomes across four school districts. And so, and then we look at school-based outcomes and how they relate to different interventions. So we’re, we’re attacking inefficiencies. But we’re not doing it in a way that is activating major new networks yet.

Lisa Graham (31:50):
I have a question for Drew. The idea of voter access is an incredibly political topic and a lot of argument comes down to trust whether it’s the voter or the institution. And so what are the arguments, I mean, is blockchain so new the government isn’t even quite looking at this yet? Or is it right now when people are looking at new voter ID laws, new ways to get people registered online… Because I mean, people have been trying to get people to register online in Texas for a very long time and it hasn’t happened. So is this a new tool for that? Or has this been in play for a while and it still hasn’t been adopted? What are, what do you think is going to happen when it comes to voter registration?

Drew Galloway (32:29):
Yeah, I think we are at the precipice of like a new beginning on using blockchain for democracy. There’s obviously some use cases out there. It was one of the original, like sort of like ideas of like, can we use the blockchain to vote online? But looking at things like, like in Texas, we’re 48th for voter turnout and like 36th/37th for voter registration. Texas is one of the hardest states in the entire nation to do voter registration predominantly because of the restrictions that are put into place. We don’t even have online voter registration. And so blockchain is going to be like, you know, will help propel us in the right direction for that. I still think that we’re, you know, like it’s a little futuristic for a lot of folks right now, but if you look at things- at what other States like Oregon and Colorado and Illinois who are both like blue States and red States are using like automatic voter registration, where when you move into the state and you get your driver’s license, like the state just automatically like verifies everything and just sends you your voter registration card, like that could be put onto the blockchain where all of these different government systems are communicating with each other. And it just like an algorithm does all of that. So if you think about it, like futuristically, like the block chain could check your voter registration, it could check your voter ID, which means we could give access to many, many more people. And then you could technically be able to hop on that same platform and cast your vote. And the blockchain is constantly verifying this.

Lisa Graham (34:09):
And is the idea then the government would have to create its own blockchain. So is, is that what would have to happen?

Drew Galloway (34:16):
I think that we could run it on like an existing blockchain, like Ethereum, or there could be like a special block-

Lisa Graham (34:21):
What’s Ethereum?

Drew Galloway (34:21):
Ethereum is another cryptocurrency that predominantly runs on, on peer-to-peer contracts. So rather than focused on, like, I’m going to purchase this item from you, it’s like, I’m either going to purchase services or, or, or like we’re going to execute a contract…

Lisa Graham (34:40):

Willy Ogorzaly (34:41):
It’s also a platform for developing your own decentralized applications. So if the government wanted to create their own voting application, they can either create their own blockchain, but then they would have to have their own miners and everything. It becomes complex. They’d have to figure out a way to give those coins real value and get the market to agree on a certain value, or they could just build it on the Ethereum blockchain and use all the tools that Ethereum has there and then leverage the network of Ethereum miners.

Lisa Graham (35:02):
Got it.

Matt McDonnell (35:03):
Drew, would you talk about Hyperledger?

Drew Galloway (35:04):
Sure. So that’s the Linux blockchain, that’s fairly new as well. And I think that that’s you know, the last time I talked to the folks at Linux, they were really thinking about that being like a business government based blockchain as well. And so there’s a, there’s a lot of application work that’s happening on Hyperledger as well.

Matt McDonnell (35:21):
Interesting. Yeah. You know, one of the things that I think a lot about with blockchain is, is the possibility to just create so many more entrepreneurs. I think when, when you think about distributed organizations, right or the idea that here’s this thing that we have to do collectively and how there are a thousand people that are willing to plug in and they each have different skill sets, but the blockchain can organize them and accomplish them. You hear people talk about it a lot as an organization, without a CEO, right. Or, or without executive leadership. And I think that that’s really you know, at least for me, one of the things that’s most exciting is you sort of empower people, but we touched on this a little bit. You also give those folks control over their online presence. Right. so, but one of the things that, you know, listening to you guys talk, right, there’s, there’s a lot of enthusiasm here about the blockchain and cryptocurrency, but it almost sounds too good to be true. Right. Whenever people just have a litany of good things, right? Oh, it’s totally transparent. It’ll never happen: the 51% of the people will will collude to change the rules or the ledger. Right? So what are the things that could go wrong? Or what are the things that you guys are worried about is as this nascent field gets going?

Willy Ogorzaly (36:29):
So one thing to keep in mind that it is in the infancy stage. So the reason that there are all these benefits is that the technology itself is absolutely disruptive and revolutionary. And it, it answers, it’s the answer to a lot of the problems that have prevented us from having these trustless distributed organizations in the past. But the technology is not there yet. So right now, a lot of these applications that we’re talking about may or may not be able to exist because if everyone were to start using this platform and you were able to have thousands of individuals contribute to an enterprise and stuff, it might, the technology right now might not be able to scale to accommodate that growth or the fees that you would need to pay to incentivize the miners to validate this blockchain on the current protocols that are popular might be too exorbitant to justify using that platform. And in fact, because the fees have grown so much on platforms like Ethereum, there’s a ton of companies right now that built a use case on the blockchain that made sense at the time because the fees were cheaper, but now that the fees have increased, their business is no longer feasible. So that’s something to keep in mind is that this technology absolutely is as revolutionary as everyone sees it being and it has that potential, but the technology hasn’t quite caught up. So just like in the early stages of the internet, it’s going to take some time. But the enthusiastic guys like Drew and Ryan and stuff, as long as they keep chugging along and building stuff and, you know, new entrepreneurs come out and raise a bunch of money and then put that money to work. It’s- I’d see this ecosystem evolving very quickly.

Drew Galloway (37:48):
I would say an opportunity as well is education. So everybody says blockchain and it’s, it’s a little, you know, it’s out and about, but a lot of people don’t understand the blockchain. So like, as I’m talking about like blockchain as a tool for like a more accessible, more fair, more secure democracy they see like voting online and immediately just sort of like pushed that to the side. And even like we’re seeing local state and national government, our national government, moving towards like paper ballot, like initiatives, like Bexar County moving to paper ballots. So in my mind, that’s like a step back rather than looking like, what is a solution facing forward that we can do? Because if you look at access as a problem in democracy, we’re really looking at like going to a specific place at a specific time for this specific purpose, which is to fill out this paper ballot when, if we had a blockchain system that, you know, was robust and secure, that, you know, you could vote in the middle of the night and you’re on your laptop or in your cell phone and then just, you know, be done with it.

Matt McDonnell (38:56):
So, so are you saying that one of the risks is that there there’s almost this, this sort of potential backlash to the implementation of blockchain, right? That there’s sort of a, it’s maybe too uncomfortable for people or there’s too much of an adoption challenge.

Drew Galloway (39:10):
I think there’s an equation for blockchain to the internet. And so since we’re in the early stages of this technology, everybody associates the internet with like insecurity and hacking and, and issues like that. And so w so when you think of blockchain, you think, well, it runs on the internet, it runs on my computer. And so it’s linked in this way. And so I think there’s that education part of that of like, “Hey, listen, this is like, it, it does work. It runs on the internet, but it is a completely different like, you know, beast of its own.” And so I think in a lot of ways, I believe we’re in, like the word in 1992 of the internet is like right now with the blockchain.

Matt McDonnell (39:52):
So, so let’s, let’s stick with that a little bit cause I have a question there. Right? So, so Mark Anderson sort of famously says that, you know, when Netscape was created, right, that it was supposed to be a fully annotated thing. And so when you think about that, right, that didn’t happen, right? The internet is, is not a fully annotated web of all the world’s information. So I’m just sorta curious. Right. You know, we, we’ve sort of heard these stories before and even within your analogy. And so, you know, I think of Wikipedia a lot too, right. Everybody said, Oh, well, this is going to eliminate all of these books and it’s going to be this, you know, single source of truth. And we all know that that hasn’t panned out that way either. So I guess I’m just curious to hear, why do you think, or, or you, Ryan, why do you think blockchain is different than the stories that we’ve heard before?

Ryan Lugalia-Hollon (40:37):
A few thoughts from what I’m not an internet historian, but from what I understand, blockchain is actually a lot closer to what some of the pre-internet era envisioned. And so if you think the internet was supposed to have seven layers, only the top three got built, and blockchain’s almost an error of building in layers four, five, six, and seven to deepen privacy, deepen insecurity and deepen the types of sharing that can happen. I want, I do want to loop back to the risks though, cause there are two major risks that I don’t think got discussed. One is energy inefficiency in a way that is burning greenhouse gases. And so if mining is the only approach to verification and new strategies aren’t developed, and if clean tech solutions are not developed to drive that mining, then especially because of some of the cryptographic elements and of how it, you know, the, the codes have to get harder and harder to crack for mines, for mining, to work then this could be a major energy suck on the planet. The second one is increased inequality. So we’re 20 years into mainstream internet. And we’re still talking about the digital divide, both in Austin and in San Antonio. And so despite the best intentions of bleeding hearts like Willie, Drew, and myself, you know, if, if, if platforms are not built out in a democratic way that are accessible for low-income communities, just as they are for high-income communities, then all sorts of new divides could enter as this revolution unfolds. And it’s risky. Anytime, something like this, you know, two things are gonna happen, right? So either what we’re talking about becomes real, and this is a fundamental shift in how trust operates in our society or two- it’s a bust, right? If it’s a bust, then you know, this was a cool podcast; It was great to meet you guys, but it was a waste of time compared to what I should be focusing on. But if it’s the first one, you know, if this is a real shift in our society and we’re not focused on the social applications of it, then we run that risk of blockchain accelerating inequality, which is, which is why I think folks like us are willing to give our time and energy to this because we’re placing a bet that, hey, this is real. And we want to make sure it’s applied in a way that advances social inclusion and social justice and helps make the world a better place.

Matt McDonnell (42:59):
Yeah, yeah. And so you know, we’re we’re coming up on our time here, so I want to circle around and make sure that folks have, have sort of their final chance for parting shots. And so, you know, think ahead, right? We we’ve spent a lot of our time talking about how this is in its infancy. We think blockchain could be useful for social good. We think cryptocurrencies have social good applications. What does this look like in, you know, if everything comes true that you’re talking about, Ryan, what does this look like in 20 years? And, and you know, how, how do you truly see this as being transformed?

Willy Ogorzaly (43:29):
Well, I mentioned the fridge example earlier. I like to, I like to I think about both blockchain and IOT, the internet of things and the intersection. I think there’s going to be really big in the next decade. So imagine, you know, your fridge being connected and your carton of milk being connected with IOT sensors, and you run out of milk in your fridge knows; it has its own wallet and it automatically orders food from the grocery store. And there’s no one that needs to be in there from the transaction. In fact, it doesn’t even need to go to the grocery store. It can go to whoever has the milk at the best possible price and can deliver it and all that’s verified. So you don’t even need to think about it. It’s totally trustless. It’s as efficient as it could possibly be. And it’s all connected. So that’s one example of how blockchain and current technologies and stuff can change our lives.

Matt McDonnell (44:12):
So, so the, the big vision is basically like a better Amazon or, I mean, is that what you’re saying? Or what, you know, what, how is this really going to change the way we live? Right.

Willy Ogorzaly (44:19):
So that’s just one note. That’s just one piece, but that’s just how, yeah, it’s just an incremental improvement, but that’s an example of how something right now that, you know, we might take for granted or that something that we all do every single day could be replaced so that our kids aren’t even have to think about it. And I think that that is an example of how profound this could be, but those exact types of interactions are going to be prevalent throughout your life. I think just like we all use the internet all day long and very few of us understand how the internet actually works. It’s going to permeate every inch of your life. And every application that you use, I think is, I don’t know about every application, but I could see it. I could see every application that we use as these blockchain technologies evolve, not being stored in the server, but being stored in this distributed network. And being- in using some blockchain protocol.

Drew Galloway (45:00):
I think the big vision for me is that blockchain is going to usher in this era of like trust and like freedom. And so like, you know, imagine like voting and, you know… and the 2020 presidential election. But we have the blockchain instead of our, our normal like systems. So so the, you know, like the government would say, okay, we’re going to open the blockchain in September. So rather than just two weeks of early voting, that’s run by the county, you would basically say like the blockchain opens in September and runs for two full months, you’ve got two full months to vote. So you go into your wallet, cast your vote for, for the ballot and then, you know, come out. And that’s it so ultimately-

Lisa Graham (45:43):
And hope that who you voted for doesn’t say anything horribly inappropriate.

Drew Galloway (45:46):
But if that happens, you can go back in and, and make an amendment to that contract because the blockchain doesn’t execute that contract until 7:00 PM on Election Day. And so you can go in and change that. And then ultimately at 7:00 PM and one second, the blockchain executes everybody’s votes-

Lisa Graham (46:09):
And could it record all the flip flop so you can actually watch…

Drew Galloway (46:12):
You know, I mean, I think that, yeah, I think that-

Lisa Graham (46:16):
I mean it would, right? [Laughter].

Drew Galloway (46:16):
Yeah. And you know, and then you could even go back and see how you voted like four years prior, where, or how did you vote in the, in the, the city council election as well. And so you, then you begin to build this like history of democracy that’s built up. and then you begin to trust the system of like, my vote did matter. The two reasons why young people don’t vote is voting is too difficult and my vote doesn’t count. And so if you can solve that trust issue of like, my vote does matter, and you can do that through the blockchain and make that super accessible to when you can do that in the middle of the night, or if you want to vote on election day at a kiosk at your local library, you can do that then any, any of that is all possible. And it will revolutionize the way that we make our voices heard as citizens

Ryan Lugalia-Hollon (47:04):
Right now karma is a spiritual philosophy, right? But I think we’re entering an era where we could have the technology to make karma much more reall where the space between a cause and effect socially is really closed. It’s a lot, it’s a much shorter distance. And so when my actions become more transparent, my motivation for being virtuous, for being altruistic dramatically, right? Because the visibility on that increases. And so we could create a society where social change is incentivized in ways that it’s just fundamentally not right now, because we’re able to be jerks all the time. We’re able to be selfish all the time, but if we bring deep transparency to our behavior and to our actions in new ways, then that could shift. And so two, just applications of that: one to really relate it to my work is, you know, in order for me to help the city of San Antonio, make sure that every young person is ready for the future. I need to operate networks and powerful, compelling, and efficient ways that draw in leaders to act differently. And so blockchain can help me to do that. And it can help me move into an era of measurable movement building. And I hope we get there. Another application tied to the Jane Jacobs phrase, “eyes on the street” is safety. There’s been so much conversation in this country around, “Hey, we know mass incarceration is horrible and not effective. And we know there’s a lot of issues around police abuse of power and police accountability. What do we do?” You know, how do we reconceptualize community safety in ways where we’re not asking police officers to overcome the inequality, the unemployment, and the mental health crises in the communities that they’re navigating. And instead we’re empowering residents and community leaders and fundamentally new ways to take actions that we know are associated with safer communities. And so you know, as an urban planner, I’ll just say that the way we approach community development, the way we approach urban development can involve people in fundamentally new ways. So, yeah, it’s infinite.

Lisa Graham (49:09):
Great. Well, thank you all for being here, Willie, Ryan and drew. This has been really fascinating. Thank you so much. And check out the links in the description for more information and resources about cryptocurrency and on each of our guests organizations, we have links to each of their organizations online that y’all can check out. And the Notley podcast is sponsored by Chez Boom audio and the talented Shayna Brown. Shayna has a pretty cool story that we’ll link to in our notes section. And you can check out the studio at chezboomaudio.com, that’s C H E Z boom audio.com. And you can learn more about Notley and our social innovation projects at notleyventures.com.